I'm using .9GB (700MB free).
Really though, it manages memory fine. The idea you have to have "free" memory is an idea that really isn't correct any longer. A bunch of free memory sitting there doing absolutely nothing is useless and there's no point in it. Better to load it up with something.
Of course, some other people will disagree. But the general idea is an app sits in memory so it loads instantaneous (or nearly) if you need it. If you need something else that's not in memory, it empties the enough memory to make room (again, nearly instantaneously), then loads the new request into memory (a slower process than if it was sitting in the memory ready to be used).
If the memory was always empty, everything you requested would have to load into memory everytime you load it. A bunch of empty memory should make the phone slower since every request would have to be loaded into memory, not to mention it's going to take more battery and several other detrimental things to load the app everytime it needs it.
Or picture it like this....if you open the Facebook app 40 times a day, it's going to load a lot faster if it keeps that in memory than if it doesn't and thus has to load it into memory every time you launch it. It's a similar concept to your browser caching content so it loads faster. You can empty the cache, but the next time you visit the page, it's going to load slower because it has to read everything again (and have you every heard anyone suggest emptying the browser's cache in order to speed up the browsing experience? No).
It's also similar to how Windows works (since Vista). Programs load into memory in anticipation you will want to use them....but if not, there's really no tradeoff since unloading them from memory doesn't take any time. I remember several friends loading Vista, looking at how much memory it used compared to XP, and dismissing it outright just because of that, despite it managed memory completely different (don't get me wrong...plenty of reasons to dislike Vista but memory usage wasn't a valid one).
I think I got all that right, but here's a nice Android Central article explaining it better than I can:
RAM: What it is, how it's used, and why you shouldn't care | Android Central
And that's from a year ago....Android's only gotten better with Memory management.